Within the building industry, builders and general contractors generally require that their subcontractors and other service providers provide proof of insurance. In some instances, particularly diligent builders may further require that their subcontractors include language in their respective insurance policies naming the builder as an additional insured. In many instances, it is difficult to ensure that the subcontractor maintains the policy for the length of time and at the level of protection that is required by the builder. Therefore, the builder must trust the contractor to maintain coverage for the length of time required and at the required limits. If a subcontractor fails to pay a premium, for example, its insurance certificate becomes useless in the event of an accident or claim, because the policy would no longer be in force. Similarly, if the contractor adjusts coverage to decrease premium payments, the level of protection will be decreased.
Currently there is no practical or functional way to independently verify that the insurance coverage information submitted by a contractor is accurate or valid. In most instances, the risk management protection is performed via audits and one-time snapshot types of risk management assessments. Audit results become less and less accurate and meaningful each minute that passes after the assessment and verification is made. One of the hurdles to effective risk management via insurance policies is the difficulty in verifying and tracking that a contractor has and maintains the appropriate coverage, the appropriate endorsements naming the builder as an additional insured, that the premium has been paid on time, and that the policy is otherwise in force as expected by the builder. As such, there is a need for improved systems and methods for insurance verification.
Presently there is a need for a verification process to allow a hiring party to verify that an action by a performing party has been performed. The process would allow any user/owner/operator who hires or contracts with any person or entity to provide a good or service that would potentially create liability for the hiring party to verify that an action has occurred. Typically the verification would be for insurance, bonding, or some other form of guarantee that would protect the hiring party from these potential liabilities.